NEW YORK: Wall Street stocks fell Tuesday as markets weighed the latest flare-up in tensions between Iran and Israel and debated the effects of a major US port strike.
Iran launched around 180 missiles at Israel on Tuesday in response to the killings of Tehran-backed militant leaders, prompting alarm across the region and vows of retaliation.
Stocks were in the red the whole session and the uncertainty pushed both the Dow and S&P 500 back from Monday's record closes.
The Dow Jones Industrial Average finished at 42,156.97, down 0.4 percent but about 200 points above its session lows.
The broad-based S&P 500 fell 0.9 percent to 5,708.75, while the tech-rich Nasdaq Composite Index dropped 1.5 percent to 17,910.36.
Karl Haeling of LBBW said the market's partial recovery from session lows reflected that Iran's action appeared less severe than feared.
"My expectation is that neither Israel nor Iran want a broader war," Haeling said.
Analysts also cited worries about a potential reignition of inflation after US dockworkers went on strike, shuttering ports on the East and Gulf Coasts.
Among individual companies, Apple fell 2.9 percent following a Barclays report that the tech giant lowered its orders for new semiconductors, a sign that demand for new iPhones is lagging expectations.